BBB: How to avoid scams when shopping for a used car online

A quality used car can be a good investment but watch out for sketchy sellers and predatory loans.

Tariffs on vehicles and auto parts are likely to impact both the new and used car markets to some extent in the coming months (though for the time being, major auto companies have absorbed much of the impact on pricing). Uncertain pricing could potentially make it harder to tell if a seller is trying to pull a fast one.

BBB received nearly 21,000 complaints about used car sales last year, often from buyers who purchased a car that malfunctioned or failed to pass an inspection. Some people have reported running into scams when searching for used cars online. Shoppers should also be on the lookout for lenders who offer expensive loans expecting that customers will not be able to repay them.

To avoid issues when you’re shopping for a used car, BBB recommends you do your research in advance and know your rights as a buyer.

What do I need to do before I buy a used car?

• Basics first. Before buying any car, set a budget, research models and know how you will pay for it. The goal is to be armed with information and confident in what you want before you talk to a seller.

• Compare car prices. Research online (try using a resource like Kelley Blue Book) to get an idea of the average retail prices of makes and models you’re interested in.

• Look at both new and used car dealers. Both new and used car dealers may have used cars available. They can provide you with carefully inspected vehicles and may include warranties, and some offer a “certified” used car program.

• Research sellers at BBB.org. If you’re getting your used car at a dealership or similar business, you can look up its BBB Business Profile to check if it is a BBB Accredited Business, see its rating and read customer reviews. This can help you gauge whether the business is trustworthy.

• Use caution with private sellers. Private owners may sell their cards through online marketplaces, classified ads or word-of-mouth. This can be a good way to get a deal on a well-maintained car, but you won’t have the protections of working with a trusted company. Remember that fraudulent dealers may disguise themselves as individual sellers, offer stolen or damaged cars, or have had their odometers rolled back to hide mileage.

• Compare lenders. If you intend to use an auto loan to pay for your car, get quotes from at least three trusted lenders and compare them before making a decision.

How can I tell if a used car is good quality?

• Ask specific questions about the vehicle’s history. Find out as much as you can about the car before buying it. The salesperson should provide a vehicle history report, which includes records on prior inspections, maintenance and accident history. This doesn’t guarantee the car’s condition, but it can help you make an informed decision.

• Visually inspect and test drive the car. Look and listen for signs of damage or poor performance.

• Consider an independent inspection. Getting your own inspection by a licensed mechanic before buying can give you information on the car’s condition that isn’t typically included in the vehicle history report.

How can I avoid scams when shopping for a used car?

• Think twice before buying after a natural disaster. After floods or similar events, opportunistic dealers may try to sell damaged vehicles before the damage information appears on vehicle history reports.

• Shop carefully online. If you’re shopping for a used car online, look up the seller on BBB.org to make sure it’s a legitimate vendor. BBB has received reports from people who paid for a car online that didn’t exist. Follow BBB’s online shopping tips to spot red flags on websites such as a lack of contact information.

• Know your rights. The Missouri Attorney General and Illinois Attorney General provide information about your “Lemon Law” rights when buying a used car. Per an FTC rule, anyone selling more than five used cars per year must provide a Buyer’s Guide for every car that has information on any issues with the car or conditions of sale.

• Get it in writing. As with any big purchase, get a written contract and read it carefully before signing. Make sure all commitments, conditions and warranty details you’ve discussed verbally are in the contract. Discuss what will happen if you fall behind on payments and how the seller will communicate with you about that.